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About IFIs and IFFOs:

The OPEC Fund for International Development is an international financial institution established in 1976 by member countries of the Organization of the Petroleum Exporting Countries (OPEC).

For reference: The Organization of the Petroleum Exporting Countries (OPEC) is an intergovernmental organization uniting 12 oil producing countries: Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates, Venezuela.

Website: www.ofid.org 

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The decision to create OPEC was taken during the Baghdad Conference in 1960. The OPEC Charter was approved in Caracas (Venezuela) in 1961.
The Director General of the OPEC Fund is Suleiman J Al-Herbish.The headquarters of the Fund is located in Vienna (Austria).

The purpose of the Fund is to strengthen financial cooperation between OPEC member countries and other developing countries by providing financial support for their socio-economic development.

The Fund can be used by international financial institutions that assist developing countries and all non-OPEC developing countries.

Cooperation with the Republic of Uzbekistan:

Cooperation with the OPEC Fund dates back to 2000, when the Agreement on Promotion and Protection of Investments was signed between the Republic of Uzbekistan and the OPEC Fund.
In accordance with this Agreement, a credit line in the amount of $5 million was opened for the National Bank to finance small and private business projects.

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Further, the sphere of cooperation was expanded to areas such as transport and education, in particular, the following projects were implemented:

— “Modernization of railways” in the amount of $5.0 million. (2004);
—  “Construction and equipping new buildings of secondary schools” in the amount of $5 million. (2009-2011).

On July 3-5, 2007, Tashkent hosted a meeting of members of the Arab Coordination Group (ACG), the members of which is the OPEC Fund for International Development.
Following the ACG meeting, the OPEC Fund for International Development expressed its willingness to consider participation in financing 6 projects for a total amount of $131.2 million in such areas as education, agriculture, irrigation and land reclamation, production of building materials and phosphate fertilizers.

According to the results of the study, the following projects were agreed and launched:

— “Restoration of the irrigation network and drainage system in Jizzakh and Syrdarya regions” (12.7 million dollars);

— “Rehabilitation of “Kuyi-Mazar” pumping station in Bukhara region” (12 million dollars).

In addition, during 2009, jointly with the Fund, the issue of financing the project “Development of secondary special vocational education in the sectors of transport and agriculture” was carried out in the amount of 16.6 million dollars, which was reviewed by the Economic and Social Research Foundation on June 22, 2009. However, the elaboration of the project has not received further development.

However, in the period of 2003-2007, the OPEC Fund allocated in the total amount of $9.2 million, to such companies as Bursel Tashkent Textiles LLC ($5.9 million) and Arktek Technology LLC ($3.3 million).

On November 6-7, 2012 a roundtable was held in Tashkent with participation of members of the ACG, under which Arab funds were offered 16 projects worth 487.8 million dollars for consideration. From the number of these projects, the OPEC Fund selected 4 projects in the amount of $145.7 million.

In March 2014, the OPEC Fund informed that in order to finance investment projects in Uzbekistan for the period of 2014-2016, the fund has reserved funds in the amount of 39 million dollars, including for co-financing with the Saudi fund for the development of the project “Improving drinking water supply of the rural population of Koshrabad district of Samarkand region” in the amount of 11 million dollars.

Reference: Terms of financing of the OPEC Fund: the loan amount is 11 million dollars, the loan term is 20 years, including a 5-year grace period at the rate of 2.25% per annum, the maintenance fee is 1% per annum.

For the remaining amount of 28 million dollars, the OPEC Fund proposed to consider one of the following options for participating in financing projects in the republic:

– two projects – “Introduction of alternative energy sources in 632 secondary schools in remote and inaccessible territories of the republic” (10 million dollars) and “Improvement of drinking water supply of Zarkent, Khodjikent, Iskovot, Bulokboshi, Buston, Yoshlik and Namangan city of Namangan region” (20.3 million dollars); or

-project “Reconstruction of the water supply system of the district centers of Kasan, Mubarek and rural settlements adjacent to the conduit from Kitab – Shakhrizabz groundwater field” (38 million dollars).

In 2013, the abstracts of projects “Improvement of drinking water supply in Zarkent, Khodjikent, Iskovot, Bulokboshi, Buston, Yoshlik villages and Namangan city of Namangan region” and “Reconstruction of water supply system of Kasan, Mubarek district centers and rural settlements adjacent to Kitab – Shakhrisabz water supply network groundwater deposits” were sent to OPEC Fund in the prescribed manner. The OPEC Fund, after reviewing the annotations of the above projects, requested to submit a pre-feasibility study and feasibility study project.

Pre-feasibility study of the above projects was transferred to the delegation of the OPEC Fund within the framework of the next meeting of the Arab Coordination Group on October 27, 2014.

Based on the review of the pre-feasibility study of the above projects, as well as the existence of a signed loan agreement between the Republic of Uzbekistan and the Saudi Development Fund for the project of Improving the drinking water supply of the rural population of Koshrabad district of Samarkand region (co-financing from the Saudi Development Fund), the OPEC Fund started the implementation of this project on April 20-27, 2015, sent an assessment mission to Uzbekistan.

The loan agreement on the above project was signed on February 22, 2016 at the headquarters of the OPEC Fund in Vienna.

At present, the portfolio of financial resources approved by the OPEC Fund for Uzbekistan amounts to $50.7 million. With the support of the OPEC Fund, a number of significant projects in such areas as irrigation and melioration, water supply and public utilities continue in the country.

For reference: Currently, within the framework of financial cooperation, the implementation of 5 projects in the amount of 39.7 million dollars has been completed, 1 project for 11.0 million dollars is being implemented, 3 projects for 58.3 million dollars are being worked out.